Do you need to file a gift or estate tax return?

February 15, 2019

Are you the executor of an estate for a loved one? Have you made substantial gifts of your wealth to any family members? If your answer to either question is YES, then here’s a brief summary of what needs to be done.

Gift Tax Returns

Form 709 is required for gifts provided to or for someone during the tax year, unless it was to your U.S. citizen spouse. For the 2018 tax year, the exclusion amount is $15,000. If your spouse is a noncitizen, the threshold for 2018 is $152,000. There’s an additional caveat though. If you make gifts of FUTURE interest, even if LESS than the exclusion amount, or if you split gifts with your spouse no matter the amount, you MUST file a gift tax return. Your deadline is April 15th for this filing, but you may extend to October 15th. Filing this form doesn’t necessarily equate to owing tax, so seeing a CPA who can address all the nuances is important!

Estate Tax Returns

Form 706 is due nine months after the date of death. Form 4768 can be utilized in seeking an extension for filing and/or for time to pay, but the latter is subject to the IRS’s discretion. Remember, a return is required even if there’s no estate taxes owing. Your CPA will need to take into account all deductions and credits that apply to your particular situation, including the portability election.

Yes, these tax rules and regulations are complicated and we are prepared to assist you in navigating them. Please feel free to contact us for a no cost consultation at 772-231-6902.